National Semiconductor posts surprise profit

CBS.MarketWatch.com

SANTA CLARA, Calif. (CBS.MW) -- National Semiconductor posted a slim profit Thursday, saying stronger-than-expected bookings and improving market conditions put the chipmaker "ahead of schedule" on its bid to get back in the black.

National Semi
NSM, -2.68%
reported first-quarter earnings of $47.1 million, or 25 cents a share, including a one-time gain of $48.4 million from the sale of Fairchild Semiconductor stock. Excluding the gain, the company earned a pre-tax profit of $1.2 million.

Analysts surveyed by First Call Corp. expected the Santa Clara, Calif.-based company to lose 14 cents a share.

"Given the better than expected order patterns over the summer, particularly in the mobile phone and PC markets, we have entered the fall with much better backlog in place for delivery in the second quarter," Chief Executive Brian L. Halla said in a statement released after the markets closed.

Halla added that National Semi sees improvement in both revenue and profitability for the company's second quarter.

In the year-ago period, National reported a loss of $104.8 million, or 63 cents a share.

Revenue rose to $481 million from $469 million a year ago.

First-quarter bookings grew 12 percent over last year's first quarter in spite of negative bookings in this quarter for discontinued Cyrix PC processors, the company said.

Analog segment orders were up 57 percent over last year's first quarter, led by wireless specific circuits and related power management devices.

Additionally, National said completed its exit from the personal-computer chip business with the sale of that portion of its Cyrix unit last week.

The chipmaker announced its decision in May to exit the PC business, saying the PC market had been dragging down its financial performance for several quarters. See archived story.

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